**The European Commission has warned that Germany’s planned 4.5bn euro ($6.7bn; £4bn) state aid for carmaker Opel may breach EU competition rules.**The Commission said there were “significant indications” that the aid was promised on condition that a specific buyer for Opel was chosen.
General Motors (GM) said last month that it would sell Opel to Canada’s Magna, Berlin’s preferred buyer.
The Commission said GM should now be allowed to reconsider the sale.
Neither the German government or Magna has yet to make any comment to the Commission’s comments.
Although GM picked Magna and its Russian backer Sherbank last month to buy Opel and Opel’s UK brand Vauxhall, the deal has yet to be concluded.
‘Concerns’
The Commission said that the concerns were raised by EU Competition Commissioner Neelie Kroes in a letter to German Economy Minister Karl Theodor zu Guttenberg.
It said that in the letter she pointed to “significant indications that aid promised by German government to New Opel was subject to the precondition that a specific bidder, Magna/Sberbank, was selected”.
The Commission added that Ms Kroes “indicated that such a precondition for the aid would be incompatible with… state aid and internal market rules”.
“Commissioner Kroes explained that GM and the Opel Trust should be given the opportunity to reconsider the outcome of the bidding process on the basis of firm written assurances by the German authorities that the aid would be available, irrespective of the choice of investor or plan,” said the Commission.
Magna, a car parts firm, and its Russian backer Sherbank, were chosen by GM ahead of Belgian investment fund RHJ, Italy’s Fiat, and China’s Beijing Automotive Industry Holding.
Other government fears
Both the Belgian and Spanish governments said last month that they wanted the Commission to study Germany’s role in the sale of Opel.
Magna’s proposed deal with GM will see it take a 55% stake in Opel, with GM keeping 35% and 10% going to employees.
The Canadian firm proposes keeping open all four of Opel’s German plants, but a factory in Belgium is said to be at risk of closure.
Magna is proposing 10,500 job cuts at Opel, 4,500 of them in Germany.
Despite Magna being yet to conclude its takeover of Opel, earlier this week it secured an agreement with the UK union Unite over job cuts at among the 5,500 workers at the two Vauxhall plants in Ellesmere Port and Luton.
Magna has agreed to limited job loses to 600 people, and only through voluntary redundancy.